C The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow. Diet Mountain Total Bikes $ 300,000 $90,000 $150,000 $60,000 120.000 180.000 27.000 62,900 50.000 90,000 33,000 27,000 Sales Variable manutacturing and selling expenses Contribution magis sed expenses Advertising, traceable Depreciation of special equipment salaries of product line managers Allocated on fixed expenses Total fixed expenses Het operating income tlous) 30.000 10,000 14.000 6.000 23,000 6.000 .000 9.000 35.000 12,000 23,000 10,000 60.000 30.000 12.000 55.000 36.000 12,000 $17,000 $24,000 19.000) "Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear out Required 1 Required 2 Required 3 What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? Required 2 > Required 1 Required 2 Required 3 Should the production and sale of racing bikes be discontinued? 10 res No Ram Prepare a property formatted segmented income statement that would be more useful to management in assessing the long- run profitability of the various product lines. Contribution margin (s) Traceable fixed expenses Total traceable fixed expenses Product line segment margin (loss) Net operating income (los)